(Note: This updates and replaces earlier post)
Direct corporate contributions to political candidates will be legalized in Tennessee and the amount that can be given by all contributors will be be raised by about 40 percent under legislation approved by House and Senate committees Tuesday.
For political action committees, for example, the maximum donation will increase from $7,500 to $10,700 and adjusted upward for inflation in future years. Corporations will be treated as if they were PACs under the bill, SB1915.
Under sponsorship of Senate Speaker Pro Tempore Jamie Woodson, R-Knoxville, the bill was approved on a party-line vote by the Senate State and Local Government Committee Tuesday morning.
The House State and Local Government Committee approved it about three hours later on voice vote in the Republican majority committee. Chairman Curry Todd, R-Collierville, dismissed House Democratic Caucus Chairman Mike Turner’s request for a recorded, roll-call vote.
There was relatively little discussion in the Senate committee. Turner led Democrats in voicing dissent in the House panel.
Turner noted that foreign-based corporations would also be allowed to contribute under the bill, though House sponsor Rep. Glen Casada, R-College Grove, said they will have to have a Tennessee presence to do so.
“It’s going to be like an arms race with Democrats and Republicans trying to compete for this corporate cash,” said Turner. “Pumping this money into the campaigns is going to make it more expensive to run… A House race now costs $50,000. They’re going to be $150,000 now.”
But Casada said the move will lessen candidate dependence on PACs and provide more money to “educate voters.”
“More money is more free speech,” Casada said.
Woodson said the move is a logical response to a U.S. Supreme Court decision last year that struck down a federal law barring corporations from making independent expenditures in political campaigns. The Tennessee Legislature last year approved a law allowing independent expenditures in state campaigns.
The new bill goes beyond that to authorize corporations to directly give money to candidates and political parties for the first time in Tennessee, which has had a longstanding ban on direct corporate contributions.
The bill (SB1915) would also raise the current maximum contribution that can be given to a candidate, which has remained unchanged since 1995, according to Woodson. The limits would be raised annually based on inflation in future years.
Currently, the limit for a donation by an individual in a statewide races is $2,500 and $7,500 for a political action committee per election, or $5,000 and $15,000 in both the primary and general elections. The bill makes the inflation adjustment retroactive to 1995.
According to Drew Rawlins, executive director of the Bureau of Ethics and Campaign Finance, the new PAC limit will fump from $5,000 in a state House race would increase to $7,100 per election; for state Senate and the governor’s race, the limit would increase from $7,500 to $10,700.
For individuals, the maximum would increase from $1,000 per campaign in a state legislative race to $1,400; in the governor’s race, from $2,500 to $3,600.
The aggregate PAC limit for legislative candidates, or the maximum total dollars a candidate can accept from PACs in a single campaign, would increase from the present $75,000 to $107,200.
Current law also contains a limit on the total amount an individual can donate to all candidates and PACs overall — $40,000 to candidates, $61,400 to PACs. That is repealed by the new bill.
Dick Williams, who heads Common Cause in Tennessee, said he understands the Supreme Court ruling – which says corporations should be treated as if they were individuals – but regrets that the Legislature has moved ahead on corporation contributions.
“We think corporations already have too much influence in politics. This just adds to it,” he said.